Fitch explained the move that the authorities had limited opportunities to fight the banking crisis due to the world financial crisis and a fall in oil prices. The quality of banking assets continues to worsen despite the measures the government is taking.

Fitch has also downgraded the ratings of several Kazakh financial organizations by one notch: BTA bank, Kazkommertsbank, Halyk Bank, ATF Bank, the Development Bank of Kazakhstan, Astana Finance and KazAgroFinance. This was prompted by the downgrading of Kazakhstan’s sovereign rating. The outlook on the ratings of these financial organizations is negative. Fitch confirmed ratings of three other Kazakh banks: Alliance Bank, CenterCredit Bank and Temirbank.

The downgrading of the ratings will further limit the authorities’ ability to help the banks and will limit the banks’ borrowing capacity. Fitch regards the government’s move to provide help to four largest banks – BTA Bank, Kazkommertsbank, Halyk Bank and Alliance Bank – as positive; however, the government’s possibilities are indeed limited by the country’s foreign reserves which stood at $47.4bn at the end of October 2008.

The ratings agency also downgraded the Kazakhstan Temir Zholy railway company’s long-term rating on foreign currency from BBB to BBB-, outlook negative.

The KazMunayGaz national oil and gas company’s rating was downgraded also from BBB to BBB-, with outlook unchanged at negative.

The Kazatomprom national nuclear company’s rating was affirmed at BBB-, but its outlook was lowered from stable to negative.